Philip Hammond 'to pledge pay rise for nurses and 300,000 new homes'

Philip Hammond is set to hand nurses a pay rise and unveil a series of measures to boost housebuilding in this week's Budget.

Philip Hammond pictured on Downing St

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PA

The Sunday Telegraph reports the Chancellor will bow to pressure from nursing groups, Cabinet colleagues and Tory MPs by promising to set aside money to meet the recommendations of a pay review due next year.

The Royal College of Nursing has demanded an above-inflation rise of 3.9%, with warnings of a strike ballot if the Government does not signal a pay rise on Wednesday.

In an interview with the Sunday Times, Mr Hammond gave a strong hint he was planning a move on public sector pay, saying: “We’ve got to recognise that people in our public services feel under pressure from a long period of pay restraint.

"The public services themselves have strained every muscle, every sinew, to deliver within very tight resource envelopes. We’ve got to do what we can.”

HOUSEBUILDING

Elsewhere Mr Hammond said he would stage an "intervention" in what he called the "broken" housing market, with a focus on making sure existing planning permissions are acted on.

He will unveil a series of measures, including: an inquiry into "landbanking" by developers, clean-ups of polluted land to allow development, new roadbuilding to open up land for building and guaranteeing bank loans for small housebuilders.

“I’m clear that we need to get to 300,000 units a year if we are going to start to tackle the affordability problem, with the additions coming in areas of high demand," he told the Sunday Times.

Sources told the same paper Mr Hammond was looking at spending £5bn on housing schemes, while the Treasury will underwrite tens of billions more to boost construction.

That falls well short of the £50bn of borrowing reportedly being advocated by the Communities Secretary, Sajid Javid.

And it may fail to silence some of Mr Hammond's critics who feel he is moving too cautiously at a time voters want bolder action.

“There will be some strategic measures that look 20, 30 years into the future to secure a... supply of future housing and there will be shorter-term intervention measures which use money, powers and planning to intervene to get things done and make a difference over the next few years," Mr Hammond said.

'TELLING A STORY'

At the same time, Mr Hammond acknowledged that he had to present a compelling case for his plans.

“I recognise that I can’t use this budget just to trail a bunch of numbers, but must tell a story about where Britain is going," he added.

And he dismissed suggestions that Michael Gove had been auditioning for his job during Cabinet meetings.

“It would be absurd to suggest that no one but the chancellor and the chief secretary was allowed to talk about the economy.”